May 6, 2011

December 7, 2011

Newt Gingrich is straddling a fine line: Even as he courts evangelicals wary of his two divorces, a Gingrich political committee has taken millions from a casino titan whose industry is often anathema to the Christian right.

Confronted with repeated questions about his personal life, Gingrich has created a pair of religious-oriented nonprofit groups that since 2009 have raised over $5 million to boost his standing among evangelical conservatives.

Meanwhile, Gingrich’s key political group, American Solutions for Winning the Future, has hauled in $7 million from one big financial backer — Sheldon Adelson, the multi- billionaire chairman of the Las Vegas Sands casino, who is expected to help raise funds for Gingrich if he opts to run for president. The Sands recently disclosed it is under Justice Department investigation for possible bribery in the Chinese gambling hub of Macau where it has a major casino operation. And last December while Adelson was visiting Macau, the police anti-vice squad raided his Venetian Hotel and arrested more than 100 alleged prostitutes and pimps on charges of running a sex ring out of the resort.

Welcome to the world of the former House Speaker, who has long been plagued by controversies and contradictions. As Gingrich hints that he’s looking to get into the race early next month, his sprawling network of profit and nonprofit groups, dubbed Newt Inc., may have a challenge juggling dueling constituencies.

Call it saints and sinners.

Consider:

Gingrich has worked hard to cement his ties to the religious right in the last two years by appearing at half a dozen large pastors’ meetings in early primary states such as Iowa, New Hampshire and South Carolina. The religious leaders typically talk about the central role they believe religion has had in America and about issues dear to them like abortion.

Gingrich’s vehicle for boosting his image with evangelicals, Renewing American Leadership (ReAL), last year set up a political arm that channeled $150,000 to two groups in a successful drive to oust three Iowa Supreme Court Justices who sided with gay marriage.

A large Israeli newspaper owned by Adelson, a staunch ally of the Israeli right, last year featured a picture of Gingrich on its front page. In the accompanying article, Gingrich raised fears that Obama administration policies towards Iran and terrorism could lead to a “second Holocaust.”

The federal probe into potential bribery by Adelson’s Sands in Macau comes on the heels of a private wrongful termination lawsuit filed last year by Steven Jacobs, the former Sands executive who ran the Macau operation before being sacked last year. In his suit, Jacobs claims Adelson tried to get him to use “improper leverage” against some unidentified Macau government officials so the Sands could obtain the rights to sell apartments at a Four Seasons complex, a possible violation of the Foreign Corrupt Practices Act. A Sands spokesman, Ronald Reese, said that “We are cooperating fully with the investigations.” Reese also said that the hotel firm’s management in Macau was fully cooperating with the local police on the vice squad raid.

Courting evangelicals who frown on his personal life

Duality and inconsistencies have long been a hallmark of Gingrich’s career. But now the stakes are higher, as evidenced by the Georgian’s aggressive efforts to woo evangelicals who make up a large proportion of voters in early GOP primary states.

The biggest problems for Gingrich are the painful details of his two divorces, especially his divorce from his second wife, Marianne, and his marriage to his third, Callista. According to testimony that surfaced during Gingrich’s 1999 divorce proceeding, his relationship with Callista began in 1993 — when she was a young staffer on the House Agriculture Committee and he was married.

The affair with Callista continued during the four years when Gingrich was Speaker — a period in which he promoted an agenda that championed family values. In 1998, Gingrich called for President Bill Clinton’s impeachment for lying to a grand jury over the Monica Lewinsky affair.

Gingrich’s first marriage to a high school teacher, Jackie Battley, ended after 19 years in 1981 after he had an affair with Marianne. According to Battley, Gingrich told her of his plans for a divorce while she was in a hospital recovering from cancer surgery, an account that Gingrich has disputed.

Gingrich’s aggressive efforts to assuage evangelical concerns about his marital history have had mixed results, say prominent religious leaders. Gingrich has made some headway with evangelicals, but still faces huge obstacles, says Richard Land, the president of the Southern Baptist Ethics and Religious Liberty Commission.

“Yes, he’s made progress in making some evangelicals more comfortable with his candidacy,” Land said in an interview. “But it’s still a high hill to climb. Two ex-wives is more than an arithmetic progression for most evangelicals. It’s an exponential progression.”

His longtime spokesman and a director of ReAl, Rick Tyler, said, “I think he’s making very good progress with the evangelical community.”

Gingrich is building a base of financial support in the religious world that can yield dividends in a presidential campaign. Tyler said that of the $5 million that ReAL raised in 2009 and 2010, via fundraising letters that Gingrich signed, the vast majority has been plowed back into more direct mail solicitations to raise more funds and develop a strong evangelical donor base.

For instance, Tyler said that ReAL has a list of 44,000 donors who have given more than once to Gingrich’s nonprofits, which would be a very valuable asset for a Gingrich presidential campaign to tap for support.

More broadly, Tyler noted that Gingrich will be able to use mailing lists connected with other parts of Newt Inc. as well as lists of people who have responded to fundraising appeals he’s signed for the Republican National Committee and the Republican Governors Association. The combination could allow Gingrich to tap lists totaling as many as 2 million names.

ReAL Action, the political arm of Renewing American Leadership, hopes to raise between $500,000 and $1 million by mid year, Tyler said.

Its maiden foray was to funnel $150,000 to two conservative groups, the American Family Association Action and the Iowa Christian Alliance. These funds were spent in the conservative drive to remove three Iowa Supreme Court Justices who had ruled in favor of same sex marriage, an issue high on the agenda of social conservatives.

ReAL Action has spent about $100,000 to organize a conservative coalition in Washington that’s been pushing for a balanced budget amendment. Tyler said his group helped recruit and pay the salary of the coalition’s director, Kellen Guida, and has also spent funds to set up a website for the coalition.

Gingrich has stepped up his appearances at meetings of religious pastors in the last year. Last month, he flew to Des Moines to give a talk to some 600 pastors attending a day-long clergy event which also drew potential rivals including Mississippi Gov. Haley Barbour and Rep. Michele Bachman.

The centerpiece of Newt Inc. is American Solutions for Winning the Future, a 527 nonprofit which can accept unlimited donations. Since 2006 it has raised a whopping $52 million, much of it from energy companies, real estate interests and several conservative moguls attracted to Gingrich’s long time advocacy of reducing the size of government including his anti-regulatory and anti-tax stances.

For instance, the 527 has corralled close to $2 million from several giant energy companies including Peabody Energy, the nation’s largest coal company, Arch Coal, and Devon Energy. In the last two years, American Solutions has focused heavily on calls for abolishing the EPA and replacing it with a new agency that would be more business friendly.

Casino billionaire is Gingrich's single largest donor

Far and away the group’s largest backer is Adelson.

Tyler said that Gingrich and Adelson are quite close: “Newt and Adelson talk often and their shared interest is Israel.”

Both men are deeply worried about Israeli security and have an affinity for Israel’s hawks. Last May, Adelson’s Israeli daily, Israel Hayom, featured Gingrich on the front page with a big headline which read: “The Obama Administration is Denying Reality.” In the story inside, Gingrich warned of a “second Holocaust,” if policies didn’t change. The free paper is now one of the largest-circulation publications in Israel.

The casino mogul views Gingrich as one of the leading GOP voices on such topics as the need for a strong U.S.-Israeli relationship, the threat of radical Islam, free market health care reforms and a strong anti-union stance. Tyler said Adelson has attended many events hosted by American Solutions, which often include long-time donors with potential donors.

In recent years, Adelson has made one of his planes available to Gingrich for travel on a handful of occasions. Tyler said Gingrich has not used any planes owned by Adelson or the Sands for political travel, but declined to comment further.

Adelson is famous for writing six- and seven-figure checks to conservative groups such as the powerful and conservative Republican Jewish Coalition, which is holding a three-day meeting at the Venetian in Las Vegas this weekend. Gingrich won’t be there, but he attended an RJC event in January in Washington that also drew Adelson.

But Adelson’s largess to American Solutions could haunt Gingrich in the wake of the Sands’ SEC filing in February revealing that it was under scrutiny by Justice and the SEC for possible violations of the Foreign Corrupt Practices Act. The Sands has received a subpoena on the matter from the SEC. Similar investigations are being conducted by the Nevada Gaming Control Board and Hong Kong regulators.

The federal probe, according to Sands’ statements, is an outgrowth of the private lawsuit filed in Nevada last year by Jacobs, the executive who ran its Macau operations for over a year. Jacobs claims he was fired from his job in part because he opposed a bribery scheme in the lucrative gambling haven. The lawsuit charges in part that Adelson tried to get him to hire a local lawyer, Leonel Alves, who holds a government position in Macau and was in a position to help their business. For over a year, Alves was listed as a company counsel, a potential conflict of interest that might violate the Foreign Corrupt Practices Act.

Jacobs also charged that Adelson ordered him to conduct secret probes of high level Macau government officials. The lawsuit claims that “Any negative information could be used to exert ‘leverage’ in order to thwart government regulations/initiatives.”

The Sands has called Jacobs a disgruntled former employee and sought to discredit him. Adelson this week in comments to Wall Street stock analysts rebutted the accusations and called them “pure threatening, blackmailing and extortion.”

Gingrich’s tight ties with Adelson could cause heartburn for some social conservatives who oppose gambling. Land, of the Baptist group, said “Gambling is a nefarious industry that corrupts everything it touches.”

But Land said that thus far he is not concerned about the ties, unless Gingrich decides to back the expansion of gambling or Internet gambling or if the criminal investigation leads to charges against the Sands.